The US Bureau of Labor Statistics (BLS) reported on Friday that it revised the monthly Consumer Price Index (CPI) increase for December lower to 0.2% from 0.3%. The Core CPI was unrevised at 0.3% for the same period.
November's CPI increase was revised higher to 0.2% from 0.1%, while the October's 0.1% increase was left unchanged.
The BLS noted that CPI revisions reflect the new seasonal adjustment factors.
Market reaction to US CPI revision
The US Dollar Index edged slightly lower with the immediate reaction but erased its daily losses to hold flat above 104.00.
US Dollar price today
The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Swiss Franc.
| USD | EUR | GBP | CAD | AUD | JPY | NZD | CHF | |
| USD | -0.04% | -0.08% | 0.01% | -0.12% | 0.11% | -0.38% | 0.14% | |
| EUR | 0.05% | -0.04% | 0.05% | -0.08% | 0.16% | -0.34% | 0.18% | |
| GBP | 0.08% | 0.05% | 0.09% | -0.03% | 0.19% | -0.30% | 0.23% | |
| CAD | -0.01% | -0.05% | -0.09% | -0.13% | 0.10% | -0.39% | 0.12% | |
| AUD | 0.12% | 0.08% | 0.04% | 0.13% | 0.23% | -0.26% | 0.26% | |
| JPY | -0.11% | -0.15% | -0.18% | -0.11% | -0.25% | -0.47% | 0.04% | |
| NZD | 0.38% | 0.34% | 0.28% | 0.39% | 0.26% | 0.49% | 0.51% | |
| CHF | -0.14% | -0.18% | -0.24% | -0.13% | -0.26% | -0.03% | -0.51% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent EUR (base)/JPY (quote).
Inflation FAQs
What is inflation?
Inflation measures the rise in the price of a representative basket of goods and services. Headline inflation is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core inflation excludes more volatile elements such as food and fuel which can fluctuate because of geopolitical and seasonal factors. Core inflation is the figure economists focus on and is the level targeted by central banks, which are mandated to keep inflation at a manageable level, usually around 2%.
What is the Consumer Price Index (CPI)?
The Consumer Price Index (CPI) measures the change in prices of a basket of goods and services over a period of time. It is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core CPI is the figure targeted by central banks as it excludes volatile food and fuel inputs. When Core CPI rises above 2% it usually results in higher interest rates and vice versa when it falls below 2%. Since higher interest rates are positive for a currency, higher inflation usually results in a stronger currency. The opposite is true when inflation falls.
What is the impact of inflation on foreign exchange?
Although it may seem counter-intuitive, high inflation in a country pushes up the value of its currency and vice versa for lower inflation. This is because the central bank will normally raise interest rates to combat the higher inflation, which attract more global capital inflows from investors looking for a lucrative place to park their money.
How does inflation influence the price of Gold?
Formerly, Gold was the asset investors turned to in times of high inflation because it preserved its value, and whilst investors will often still buy Gold for its safe-haven properties in times of extreme market turmoil, this is not the case most of the time. This is because when inflation is high, central banks will put up interest rates to combat it.
Higher interest rates are negative for Gold because they increase the opportunity-cost of holding Gold vis-a-vis an interest-bearing asset or placing the money in a cash deposit account. On the flipside, lower inflation tends to be positive for Gold as it brings interest rates down, making the bright metal a more viable investment alternative.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD climbs toward 1.1350 on renewed USD weakness
EUR/USD gains traction in the European session on Friday and advances toward 1.1350. Growing concerns about the US fiscal outlook and government debt after the US House of Representatives passed President Trump's tax bill weigh on the US Dollar and help the pair push higher.
GBP/USD rallies to fresh multi-year high near 1.3500
GBP/USD capitalizes on the heavy selling pressure surrounding the US Dollar and trades at its highest level since February 2022 near 1.3500 in the European session on Friday. The data from the UK showed that Retail Sales rose by 1.2% in April, surpassing the market expectation of 0.2% and supporting Pound Sterling.
Gold reverses direction following technical correction, advances to $3,330
Gold gathers bullish momentum and climbs to the $3,330 region on Friday. The broad-based USD weakness on government debt concerns and the cautious market mood helps XAU/USD push higher. Several Fed policymakers will be delivering speeches later in the day.
Avalanche Price Forecast: AVAX eyes $30 as FIFA, VanEck back blockchain ecosystem
Avalanche (AVAX) is gaining bullish momentum, extending gains on Friday, trading at $25.74 as investor confidence grows on the back of two major developments. FIFA, football’s global governing body, has announced plans to build its own Layer-1 blockchain on the Avalanche network.
FOMO vs fundamentals: Retail buys the dip, institutional investors stay cautious
Retail optimism is rising, but institutions are still treading carefully amid lingering macro and earnings risks. Policy and fiscal uncertainty remain elevated, with trade tensions, U.S. debt concerns, and a cautious Fed dominating the backdrop.
The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.